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The Gift of an Education

It’s that time of year again! We’ve been seeing snow and all the festive decorations at our local department stores, which means the holidays are upon us.

What are you giving your child for Christmas? What’s on their wish list this year? Like most kids, they’ve no-doubt asked for another toy or the latest gadget. Here’s an interesting statistic: each Christmas, a parent gives between 2-12 gifts to their child alone (sometimes even more than 12 gifts).

This year, instead of adding another toy to your child’s collection, why not give them the gift of an RESP? This is a great alternative if you’re fed up with plastic action figures (which have dubious long-term value) and it’s a perfect investment for your child’s future.

According to the Canadian Centre for Policy Alternatives (CCPA), the cost of an annual university tuition will be increasing substantially in the years to come. Here’s a chart comparing the average cost of tuition and compulsory fees for full-time undergraduates between the 2013-14 and 2014-15 school years:

Year PEI NS NB QC ON MB SK AB BC
2013-14 $6,308 $6,851 $6,592 $3,456 $8,162 $4,334 $6,882 $6,695 $5,657
2014-15 $6,479 $7,067 $6,821 $3,865 $8,474 $4,588 $7,226 $6,834 $5,767

Let’s fast-forward to the year 2033. It’s estimated that by then, the cost of a 4-year undergraduate degree from a Canadian university could be over $122,000. 1 These are alarming numbers, but an RESP can help soften the blow.

So this year, why not consider opening one for your child? If they already have an RESP, why not invest  a little more into it over top of your regular amount in lieu of all those extra presents? You can even spread the word with aunts, uncles, cousins and grandparents about investing in their loved one’s future; you may be pleasantly surprised with the results. While your child may not understand the value of an RESP today, it will help make their tomorrow more affordable.  It truly is the gift that keeps on giving.

1 These amounts are calculated using the average annual increase of 4.38% in the total cost of tuition and compulsory and/or incidental fees for 4 years of undergraduate studies between 1990-1991 and 2016-2017. Source: Canadian Centre for Policy Alternatives, Statistics Canada, September 2013.